Audit finds Metro's contract management needs improvement

View full sizeMetro manages waste transfer stations in the Portland Metropolitan Area. The audit looked at Metro's contract with Recology and Allied Waste that use the stations.

Metro lacks clear procedures and policies to manage its contracts, according to an audit released today, and inefficiency has compromised services and wasted money. What's more, the regional government has heard the auditor's criticisms before.

Independent auditor Suzanne Flynn says Metro's biggest deficiency is in managing contracts, which is what an audit in 1996 first pinpointed as a problem. Since then, 17 audits with recommendations to improve contract management have followed. She says today's audit was a checkup that showed Metro still had contract problems.

In a letter responding to the audit, Metro officials acknowledged the audit's findings. They say Metro is working to develop better practices by standardizing oversight and documenting regulations of contracts.

The recent department reorganization as well as the complexity of all of Metro's contracts slowed down the regional government's work on improving operations, said Scott Robinson, Metro's deputy chief operating officer.

Over the last five years, Metro entered into more than 3,300 contracts -- ranging from food catering to construction of zoo exhibits -- worth $485 million. For the report, Flynn targeted three contracts totaling $130 million: two solid waste management contracts with Allied Waste and Recology, and one food and beverage service contract with Aramark.

The audit of waste centers found problems in short-staffing -- which cost an estimated $110,000 extra -- and in potential overpay for maintenance.

"As a result of how costs were split, Metro paid for none of the cost of preventative maintenance, but at least half of the cost of repair and replacement," the report reads. "This could create an incentive not to perform all the preventative maintenance activities required."

It also found that Aramark's food and beverage concession stands scored poorly in food quality and customer service and were maintained in less than ideal conditions.

"Stands were not clean, condiment counters were dirty and concession cart reparis were made with duct tape," the report states.

Robinson says Metro is developing checklists, which would, to use the waste management example, list hours of operation, staffing levels, how much material they need to recover, among other provisions. Robinson says the checklists would be filed every month.

Metro officials disagreed with the audit's criticism of low staffing at the waste management stations, stating in its response letter, "Metro pays its transfer station contractors for performance as opposed to specific levels of staffing."

Flynn said adequate staffing levels provide other benefits like increasing public safety and improving customer relations. Robinson says Metro already meets both of those benefits.

Metro is a regional government serving more than 1.5 million residents in the Portland Metropolitan area. It covers Multnomah, Washington and Clackamas counties and is responsible for the zoo, recycling and garbage services, the Oregon Convention Center, the Center for the Performing Arts, Portland Expo Center and parks in the area.